Introduction


The Exit Cafe is dedicated to helping investors and professionals of all experience levels be more aware of changes to their risk exposure and the importance of using an intelligent exit strategy to control and act upon risk.

The editorial manager and a frequent contributor to our blog is Chuck LeBeau, an industry leader in the application of technical analysis for risk management. We hope you find our blog enjoyable, educational and valuable. Please feel free to chime in on any stories or analysis posted.

Oct 18, 2008

Retirement accounts have lost $2 trillion

Retirement accounts have lost $2 trillion
By JULIE HIRSCHFELD DAVIS, AP

SmartStops comment: Elderly investors can no longer rely on Buy and Hold in today’s volatile markets. It may take too many years for the prices to recover. Investment portfolios need the protection that SmartStops can help to provide.

Excerpts: WASHINGTON -Americans' retirement plans have lost as much as $2 trillion in the past 15 months, Congress' top budget analyst estimated Tuesday.
The upheaval that has engulfed the financial industry and sent the stock market plummeting is devastating workers' savings, forcing people to hold off on major purchases and consider delaying their retirement, said Peter Orszag, the head of the Congressional Budget Office.

More than half the people surveyed in an Associated Press-GfK poll taken Sept. 27-30 said they worry they will have to work longer because the value of their retirement savings has declined.

A new AARP study found that because of the economic downturn, one in five workers 45 and older has stopped putting money into a 401(k), IRA or other retirement savings account during the past year, and nearly one in four has increased the number of hours he works.

Link to full article:

Oct 6, 2008

Dividend Cuts Hit $22.5 Billion in 3rd Quarter

Dividend Cuts Hit $22.5 Billion in 3rd Quarter
Standard & Poors press release

SmartStops comment: Investors in high dividend stocks often believe that they can ride the market up and down with little concern over declines in the stock prices .(As brokers used to joke in down markets- the yields are simply going up.) But what if the dividends that help protect the stock prices start getting cut? Based on the current news in this article, even dividend investors might benefit from the protection provided by SmartStops.

Excerpt from article: New York, October 3, 2008 - Standard & Poor’s, the world’s leading index provider, announced today that 138 of the approximately 7,000 publicly owned companies that report dividend information to Standard & Poor’s Dividend Record decreased their dividend during the third quarter of 2008, representing a 557% increase from the 21 issues that decreased their dividend during the third quarter of 2007. Reported dividend increases fell 21.2% to 346 from 439 reported in the third quarter of 2007.
“It was the worst September for dividends since we started keeping dividend records in 1956,” says Howard Silverblatt, Senior Index Analyst at Standard & Poor’s. “During the second quarter, companies were nervous and cautious. The third quarter, however, saw many companies deciding to take action, and that action took $22.5 billion out of the pockets of investors.”

Link to article: